Media giant Paramount (PARA) recently had a good idea – with advertising in open decline, maybe the key to success is to pull in more advertisers in general. That plan should be reasonable enough, but investors didn’t care much about it, sending shares down fractionally in Wednesday afternoon’s trading.
Paramount decided that it might be able to turn around its sagging advertising rates, particularly on its linear television line, by making advertising more accessible to smaller advertisers. That led to a “self-serve” advertising platform, which gives small and medium-sized businesses (SMBs) access to the streaming inventory on Paramount+ and PlutoTV, with as little as $500 to spend.
Buying in allows those advertisers to target certain geographical locations, key demographics, or even just content genres—there’s no risk that your new horror movie trailer will run during “SpongeBob SquarePants” episodes—and campaigns can start in as little as one day.
Meanwhile, on the M&A Front…
While the Skydance/Paramount deal seems to be pretty well locked in, another deal may be rising up. Internet and media holding company IAC (IAC) is planning to fire up its own dealmaking arms, having spent the last several months improving profitability at some of its previous deals. IAC noted that the dealmaking environment is starting to come back as concerns about interest rates continuing to rise start to boil off.
Reports also note that IAC, who itself once tried to land Paramount Global, is looking to “…internal M&A opportunities, or adding on to existing businesses…” rather than outright acquiring new outside businesses. However, if an opportunity presents itself, it won’t necessarily shy away from the notion.
What Is the Projection for Paramount Stock?
Turning to Wall Street, analysts have a Moderate Sell consensus rating on PARA stock based on three Buys, seven Holds, and 10 Sells assigned in the past three months, as indicated by the graphic below. After a 22.4% loss in its share price over the past year, the average PARA price target of $12 per share implies 0.97% upside potential.
